It is supported. One thing to try here is to reimport the MaskingShader (Packages/com.unity.polyspatial/Resources/Shaders/MaskingShader.shadergraph) (right click → Reimport). If that doesn’t work, it would be helpful to know if there are any relevant error messages in the log (either in the editor or the simulator).
An alternative to using the Sprite Renderer, though, is just to use a Quad with a standard Mesh Filter/Mesh Renderer and a material that uses the sprite image as a texture.